Arch Coal

Arch Coal is a United States coal mining and processing company. The company mines, processes, and markets bituminous and sub-bituminous coal with low sulfur content in the United States. Arch Coal is the second largest supplier of coal in the U.S. - second only to Peabody Energy. Arch Coal claims to supply 12% of the domestic market. Demand comes mainly from generators of electricity. Arch Coal states that it supplies coal to "148 U.S. power plants in 33 states" and has "customers in more than a dozen countries worldwide. Through its national network of mines, Arch Coal provides 6 percent of the electricity generated in the United States."

On June 15, 2011, Arch Coal completed its $3.4B acquisition of West Virginia coal producer International Coal Group. The deal will expand Arch's coal reserves in Appalachia, and the company says it will rank as the nation’s second largest supplier of metallurgical coal.

Coal Reserves
Arch Coal operates 11 mining complexes and controls approximately 2.9 billion tons of proven and probable coal reserves, located in Central Appalachia, the Powder River Basin, and the Western Bituminous regions. The company operates mines in Colorado, Kentucky, Utah, Virginia, West Virginia, and Wyoming, and is headquartered in St. Louis, Missouri. The company sells a substantial amount of its coal to producers of electric power, steel producers and industrial facilities.

Future coal plans
In November of 2009 the bank HSBC released a report entitled, "The Green Side of Black" that made estimates about coal's involvement in the future of the U.S. energy economy. In it, the bank reported that coal, even under cap-and-trade, will be a lucrative industry in the future. The author of the report also stated that Wyoming's Powder River Basin will be growing faster than other coal regions in the United States. The HSBC report stated that in Arch Coal and Peabody Energy will be especially prosperous because of their extensive involvement in the Powder River Basin.

History
Arch Mineral Corporation was founded in 1969 as a partnership between Ashland Oil (now Ashland, Inc.) and the H. L. Hunt family of Dallas, Texas. Ashland Coal, Inc. was formed in 1975 as a subsidiary of Ashland Oil. The privately held Arch Mineral Corporation merged with Ashland Coal, Inc. in July 1997, creating the present-day company.

In early May 2011, Arch Coal announced that it would takeover the International Coal Group in as cash transaction worth $3.4 billion. Arch stated that the combined company would be "the second largest U.S. metallurgical coal supplier and a top-five overall global coal producer and marketer". The company stated that it estimated that the combined company would have total shipments of approximately 179 million tons of coal and $4.3 billion in revenues with approximately "50 percent of earnings generated from eastern operations and 50 percent from western operations." Bridge financing for the deal was provided by Morgan Stanley and PNC. The company stated that it expected the deal to be completed in the second quarter of 2011.

In Feb. 2011, former Wyoming Gov. Dave Freudenthal was elected to the board of directors of Arch Coal.

In May 2011 Arch Coal announced that it was establishing a new subsidiary, Arch Coal Asia-Pacific Pte. Ltd., and named Renato Paladino president. The new office will be located in Singapore and will be used as a hub for coal exports in the Asia-Pacific region.

Arch Coal Mines
Powder River Basin area:
 * Black Thunder Mine (Wyoming)
 * Coal Creek Mine (Wyoming)

Western Bituminous:
 * Arch of Wyoming Mine (Wyoming)
 * Dugout Canyon Mine (Utah)
 * Sufco Mine (Utah)
 * Skyline Complex (Utah)
 * West Elk Mine (Colorado)

Central Appalachia:
 * Band Mill 2 Mine (Kentucky)
 * Blue Ridge Surface Mine (Kentucky)
 * Clover Fork 1 Mine (Kentucky)
 * Coal-Mac Mine (West Virginia)
 * Cumberland River Mine (Virginia)
 * Darby Fork No 1 Mine (Kentucky)
 * Holden 22 Surface Mine (West Virginia)
 * Huff Creek Mine (Kentucky)
 * Lone Mountain Mine (Kentucky/Virginia)
 * Mountain Laurel Complex (West Virginia)
 * Mountaineer II Mine (West Virginia)
 * Pardee Surface Mine (Virginia)
 * Parson 1 Mine (Kentucky)
 * Spruce 1 Mine (West Virginia)

Arch Coal mining violations
Arch subsidiary Cumberland River Coal Co. received an imminent danger notice from federal regulators on October 14, 2010 after three coal trucks operated by an independent contractor, Lemar Trucking Co. Inc., were allegedly operating in an unsafe manner on a mine haul and access road at Pine Branch 1 coal mine in Appalachia, Virginia.

Then on October 15, 2010, another Arch subsidiary, Canyon Fuel Co., received an imminent danger order from the federal government about a pipe in its rock dust transfer system that was improperly grounded at Dugout Canyon Mine in Utah.

Arch Coal to pay four million for mining violations
On March 1, 2011, the U.S. Environmental Protection Agency (EPA) and the U.S. Justice Department announced that Arch Coal had agreed to pay a $4 million dollar penalty for alleged violations of the Clean Water Act in Virginia, West Virginia, and Kentucky, and will implement changes to its mining operations to ensure compliance. In the settlement, Arch Coal agreed to take measures that will prevent an estimated 2 million pounds of pollution from entering the nation’s waters each year. Arch will also implement a treatment system to reduce discharges of selenium, a pollutant found in mine discharges, which can run off and build up in streams, with adverse impacts on aquatic organisms. Arch Coal agreed to implement a series of inspections, audits and tracking measures to ensure treatment systems are working properly.

A joint federal-state complaint filed in U.S. District Court in the Southern District of West Virginia by the United States, West Virginia, and Kentucky alleged numerous violations of Arch Coal’s permits that set limits on pollutants to be discharged into streams. The alleged excess discharges of iron, total suspended solids, manganese and other pollutants reflect deficiencies in operation and maintenance of wastewater treatment systems in place at four of the company’s mining facilities: Coal Mac, Inc; Lone Mountain Processing, Inc; Cumberland River Coal Co.; and Mingo Logan Coal Co. Under the settlement, $2 million of the $4 million civil penalty will be paid to the United States and the remaining $2 million will be divided between West Virginia and Kentucky based on the percentage of alleged violations in each state.

U.S. Justice Department has filed suit against Arch Coal Inc.
On Friday, April 8, 2011 the U.S. Dept. of Justice sued Arch Coal along with three other companies for being allegedly responsible the contamination at the Cape Girardeau site because the company arranged for disposal of transformers and other electrical equipment that contained cancer-causing PCBs. The lawsuit was filed in an attempt to hold the companies liable for any future cleanup costs or damages.

The government alleged in its suit that Arch's predecessor, Arch Minerals Corp., is partly for the contamination.

It was reported that the lawsuit represented the latest movement in a long-running effort to clean up the 6-acre site where Missouri Electric Works Inc. sold, serviced and repaired electrical transformers and other equipment from the years of 1954 to 1988. In the 1980s environmental regulators discovered that much of the property had been contaminated with PCB-laced oil from transformers and storage drums, contaminating the soil and groundwater with toxic chemicals.

The cleanup of the site began years ago, as are efforts to collect money from companies believed to be responsible for the pollution.

Powder River Basin Mining Rights and Operations
On November 12, 2009 Arch Coal (ACI) announced that they are leasing 9,600 acres in southeastern Montana's Powder River Basin. It is estimated that the property holds 731 million tons of coal reserves. The company will pay Great Northern Properties five annual installments of $73.1 million.

On March 17, 2010 Arch Coal put in the first bid for rights to mine Montana's Otter Creek coal at $86 million. This would include future royalties for the right to mine a 500 million tons of state-owned coal in southeastern Montana near the Wyoming border in the area known as the Powder River Basin. As of early 2010, Arch controlled 731 million tons of coal in Otter Creek. On March 18 it was announced that the Montana Land Board approved the company's bid and will now have the rights to mine 8,300 acres in the area.

In all Arch Coal controls 1.5 billion tons of coal on state and private land in Otter Creek. In June, 2010 the company along with Montana Governor Brian Schweitzer, toured Otter Creek where Arch Coal executives stated that they will aggressively pursue state permitting and hope to begin mining by the middle of the decade.

In July 2010, two separate lawsuits were filed by the Sierra Club and Montana Environmental Information Center challenged the state lease on the grounds that the Montana Land Board did not properly address the 2.4 billion tons of carbon dioxide emitted by the mined coal prior to the lease.

In December, 2010 attorneys for the state of Montana defended the lease of 587 million tons of state-owned coal. Representatives of Arch Coal Inc. as well as the Montana Attorney general's office asked a state judge to dismiss the lawsuits challenging the Otter Creek sale. Attorneys for Arch and the state said that review must be done before mining, not at the leasing stage. A decision is likely to come in early 2011.

Judge Upholds Environmentalist Court Challenge
In January 2010 District Judge Joe Hegel rejected an attempt by Arch Coal and the state of Montana to dismiss lawsuits brought in 2010 by four environmental groups. The rejection of the coal industry and state's challenge will allow the groups to move forward with their lawsuit, which claimed that the sale should have been reviewed under the Montana Environmental Policy Act.

Attorneys for Arch and the state had argued such a review must be done before mining, not at the leasing stage. However, Judge Hegel stated environmentalists had made a reasonable claim — that waiting until a mining application comes in could be too late to protect the constitutional right to a clean and healthful environment.

Warren Buffet and Bill Gates visit Arch Coal's Black Thunder Mine
In November 2010 Warren Buffet and billionaire Bill Gates, a Berkshire director, visited the Black Thunder Mine in the Powder River Basin in Wyoming. Buffett was quoted later as saying that he found the trip to the mine “fascinating.” Neither gave interviews during the tour, but some speculated that the trip was an indication that the two were looking to invest in the coal mining project, including coal exports to Asia. However, in the past Bill Gates has stated that coal and natural gas must be phased out by 2050.

Political Donations and Lobbying
In 2009, the coal mining lobby donated $10,423,347 to members of Congress. Of that, the top three major contributors included Arch Coal, CONSOL Energy and Peabody Energy.

The Arch Coal PAC (political action committee) is a substantial donor to West Virginia politicians.

The company spent $760,000 on staff lobbyists in 2008 which during the year included Thomas Altmeyer and John Snider.

Mountaintop Removal
The company practices mountaintop removal mining, which is controversial because it reduces the height of mountains (sometimes by 600 to 800 feet), removes all vegetation and places mining waste or overburden into mountain streams, causing flooding, erosion, and water contamination. In 2009, JPMorgan Chase helped finance $600 million for Arch Coal, which that year mined 4.7 million tons of coal using MTR.

Arch Coal's West Virginia mining operations in the Appalachian Mountains were the subject of a critical documentary in 2002 on Now with Bill Moyers on PBS. .

Arch's Dal-Tex mining operations above the town of Blair, West Virginia were the subject of a 1998 US News and World Report story "Shear Madness" by Penny Loeb. The story documented the impacts of mountaintop removal on communities close to the mines and their subsequent depopulation. A landmark 1999 lawsuit brought by the West Virginia Highlands Conservancy, Bragg v. Robertson was the first successful citizen lawsuit to stop Arch's proposed mountaintop removal valley fill. The fill would have buried several miles of stream at Pigeon Roost Hollow near Blair, West Virginia

In his ruling for the plaintiffs, Judge Charles H. Haden stated that "If there is any life form that cannot acclimate to life deep in a rubble pile, it is eliminated. No effect on related environmental values is more adverse than obliteration...Under a valley fill the water quality of the stream becomes zero. Because there is no stream, there is no water quality."

EPA goes back and forth on permit for West Virginia surface mine
On October 16, 2009, the EPA announced that it planned to use its authority to halt the permit for Mingo Logan Coal's Spruce 1 Mine, which is owned by Arch Coal. The agency said it was acting on its authority for the first time since the Clean Water Act was enacted in 1972. The project at issue would be the largest authorized mountaintop removal operation in Appalachia. In a letter to the Army Corps of Engineers, EPA Regional Administrator William Early said the action "reflects the magnitude and scale of anticipated direct, indirect, and cumulative adverse environmental impacts associated with this mountaintop removal mining operation."

However, on January 5, 2010, a federal court in West Virginia agreed to extend a deadline for discussions with Arch Coal Inc.'s Mingo Logan Mining Co. about the mine's permit, which was halted in October.

On March 2, 2010 the EPA announced that it had granted a Clean Water Act permit for the Hobet 45 mine in Lincoln County, West Virginia after Hobet Mining LLC, a company owned by Patriot Coal, had agreed to additional "significant protections" against environmental impacts. The permit now must be approved by the Army Corps of Engineers. Additionally, the EPA said it extended the agency's talks with Mingo Logan Mining Co., owned by Arch Coal, in regard to environmental and water quality concerns about its Spruce No. 1 mine in Logan County, West Virginia. Opponents of the permits, citing groundwater pollution from mountaintop removal projects stated that, “Enforceable minimum waste management requirements for dry disposal of coal ash in landfills should include siting restrictions, liners, groundwater monitoring, leachate collection, and financial assurance, closure requirements, post-closure care, and corrective action.”

On March 26, 2010, it was announced that the EPA was to veto Arch Coal's Spruce 1 Mine. The project would be the largest mountaintop removal venture in the entire Appalachia region. As of March 28, 2010 the company said it would defend the mining proposal. The public comment period is open for 90 days. The mine was opposed due to its likely environmental impact.

January 2011: EPA vetoes water permit
On January 13, 2011, it was announced that the EPA had vetoed the water permit for the mine, the largest single mountaintop removal permit in West Virginia history. In making its decision to veto the U.S. Army Corps of Engineers’ approval of the 2,300-acre mine, "Final Determination of the U.S. Environmental Protection Agency Pursuant to § 404(c) of the Clean Water Act Concerning the Spruce No. 1 Mine, Logan County, West Virginia", EPA noted that it reviewed more than 50,000 public comments and held a major public hearing in West Virginia. EPA officials said their agency is “acting under the law and using the best science available to protect water quality, wildlife and Appalachian communities who rely on clean waters for drinking, fishing and swimming.”

Report shows Arch Coal rejected reducing environmental impacts at Spruce Mine
On January 17, 2011, reporter Ken Ward revealed that Arch Coal had reportedly refused to consider paying an extra 55 cents a ton for coal in order to meet EPA and Clean Water Act standards for a mountaintop removal operation in West Virginia - Spruce 1 Mine - despite posting over $700 million in earnings for 2010.

Ward uncovered a Sep. 2010 engineering report prepared for the EPA which showed that Arch Coal could have cut the stream damage from its proposed Spruce Mine in half without significantly increasing coal-production costs. Specifically, permanent and temporary stream burial could have been cut from 8.3 miles to about 3.4 miles under one alternative mining plan developed for EPA by engineering firm Morgan Worldwide. The alternative mining plan would have raised production costs for Arch subsidiary Mingo Logan Coal Co. by 55 cents per ton, about 1 percent of the expected per-ton sales price, according to the report obtained under the federal Freedom of Information Act. Arch Coal did not adopt the recommended changes for the Spruce Mine, and in early Jan. 2011, EPA officials revoked the operation's Clean Water Act permit, citing "destructive and unsustainable mining practices" proposed by the company.

West Virginia political leaders have harshly criticized EPA for its action against the Spruce Mine, and the EPA decision prompted Acting Gov. Earl Ray Tomblin to announce a "rally for coal" at the Capitol. Ward points out that supporters of the Spruce Mine have not publicly questioned whether the company could -- or should -- have done more to reduce the project's impacts, as the uncovered report suggested.

2008: Arch Coal helps fund Consortium for Clean Coal Utilization
In December 2008 Arch Coal announced that it would contribute $1 million a year for a five year period to fund the the establishment of the Consortium for Clean Coal Utilization at Washington University in St. Louis. The project will be run by the university's International Center for Advanced Renewable Energy and Sustainability(I-CARES).

2010: Arch Coal Buys Stake in Texas Power Plant
On March 12, 2010 it was announced that Arch Coal purchased a 35 percent minority equity stake in the developing Trailblazer Energy Center. Arch stated that they will supply Trailblazer with its fuel needs for its first 20 years of operations. Coal burned in the plant will come from Arch's mines in the Powder River Basin. Arch believes that the plant will eventually utilize so-called "clean coal" technology. In 2009 Arch donated $1.5 million to the University of Wyoming for research on carbon sequestration.

Arch Coal invests in "clean coal" company
On March 23, 2010 it was announced that Arch Coal invested $3 million in ADA, a "clean coal" technologies firm that has developed "technologies that improve the performance of coals from Wyoming's Powder River Basin." CEO of ADA stated in an announcement, "This investment will continue our long-standing relationship with Arch and allow the Company to fund opportunities that have the potential for significant near-term increases in revenues and earnings such as CyClean. As Congress is considering a year extension to the Section 45 tax credits, we want to be in a position to respond quickly to sell and install additional CyClean systems to produce refined coal."

CyClean technology is an additive that is added to coal prior to combustion which the company states reduces mercury and nitrogen oxide emissions.

Northwest ports to be used to export Powder River Basin coal to Asian markets
For more information on the proposed port developments in the western United States please visit the Coal exports from northwest United States ports article.

Proposed Millennium Bulk Logistics Longview Terminal
In September 2010 Peabody Energy announced that "Coal's best days are ahead." Peabody stated that exports of coal from the Powder River Basin in Montana and Wyoming will be central to its expansion goals. The Oregonian in September 2010 reported that Northwest ports, and in particular ports in Portland, Oregon, may be used in the future to export coal to Asia. The Port of Portland said it doesn't have the space for coal exports in the short-term, but its consultants cited coal as a potential long-term market if it adds terminals on West Hayden Island.

In early November 2010 Australia-based Ambre Energy asked Cowlitz County officials in southern Washington State, which borders Oregon, to approve a port redevelopment that would allow for the export of 5 million tons of coal annually. On November 23 Cowlitz County officials approved the permit for the port redevelopment, which is to be located at the private Chinook Ventures port in Longview, Washington. Coal terminals also are proposed at two other sites along the Columbia River.

Environmentalists stated that they would oppose any such actions, arguing that coal contributes to pollution and global warming. Early discussion of how many jobs the port would produce was roughly twenty total.

In November 2010 Powder River Basin coal producer Cloud Peak Energy CEO Colin Marshall stated that a coal port on the West Coast was "absolutely more than a pipedream."

Other Powder River Basin producers, including top US coal miner Peabody Energy, have talked about the potential for a new export facility on the West Coast, with Oregon and Washington being mentioned as the top locations of choice.

Groups including the Sierra Club and Columbia Riverkeeper have vowed to stop the industry's expansion into Asia, a market currently dominated by coal from Australia and Indonesia.

Proposed Terminal: Gateway Pacific Terminal
The Gateway Pacific Terminal is a proposed terminal at Cherry Point near Ferndale, Washington, and would have a maximum capacity of about 54 million tons. On February 28, 2011, SSA Marine applied for state and federal permits for the $500 million terminal, triggering formal environmental review. If approved, the terminal would begin construction in early 2013 and operations in 2015.

On March 1, 2011, Seattle-based SSA Marine announced it had entered into an agreement with St. Louis-based Peabody Energy to export up to 24 million metric tons of coal per year through the Gateway Pacific Terminal. Goldman Sachs owns a portion of SSA Marine's parent company. According to Peabody, the terminal in Whatcom County would serve as the West Coast hub for exporting Peabody's coal from the Powder River Basin of Wyoming and Montana to Asian markets. The project would ramp up potential U.S. coal exports to Asia from Washington state. Another coal export terminal proposed in Longview, the Millennium Bulk Logistics Longview Terminal in southwest Washington, has drawn environmental opposition. That Millennium Bulk Logistics terminal would be a joint venture between Australia-based Ambre Energy and Arch Coal.

Environmental groups have appealed to Washington's Shoreline Hearings Board over a permit awarded for the port by Cowlitz County commissioners.

According to Gateway Pacific Terminal's website the company plans on providing a "highly efficient portal for American producers to export dry bulk commodities such as grain, potash and coal to Asian markets." Additionally, the site contends that the "Gateway project will generate about 4,000 jobs and about $54 million a year in tax revenue for state and local services. Once in full operation, it's estimated that Gateway will provide almost $10 million a year in tax revenue, create about 280 permanent family-wage jobs directly, and nearly 1,400 additional jobs through terminal purchases and employee spending."

February 5, 2009: Rising Tide Boston crashes Harvard lecture by Arch Coal CEO: Cambridge, MA
Seven activists from Rising Tide Boston disrupted a lecture given by Arch Coal CEO Steve Leer at Harvard University. Leer was speaking about the future of "clean coal" technology. The activists interjected information on the impacts of coal extraction, including their final question, "What gives you the right to gamble the future of civilization on a magic technology that doesn’t exist?" While Leer tried to ignore the question, two members of Rising Tide carried a banner on stage that read "The coal bubble is bursting - Clean Coal is a Dirty Lie." The lecture was funded by Bank of America, the single largest financial backer of mountaintop removal.

September 14, 2010: Rainforest Action Network protests Arch Coal mine
In September 2010 the Rainforest Action Network dumped 1,000 pounds of Appalachia dirt on the sidewalk of EPA headquarters in Washington DC in protest of Arch Coal's mountaintop removal operation, the Spruce 1 Mine. RAN's message: "EPA: Don't Let King Coal Dump On Appalachia." No arrests were reported.

Headquarters
1 CityPlace Dr., Ste. 300 St. Louis, MO 63141 United States Phone: 314 994 2700 Website: http://www.archcoal.com/

Related SourceWatch Articles

 * Wyoming and coal
 * Powder River Basin
 * Otter Creek
 * CONSOL Energy
 * Massey Energy
 * Peabody Energy
 * Mountaintop removal
 * Coal exports from northwest United States ports

Authorship of this article
''Wikipedia also has an article about Arch Coal. The article here may use content from the Wikipedia article under the terms of the GFDL. The original version of the Wikipedia article about Arch Coal used content authored in September 2006 by Gregory Kohs and released under the terms of the GNU free documentation license (GFDL) on his website, MyWikiBiz. The Wikipedia article on Arch Coal became the focus of a controversy between Kohs and the Wikimedia Foundation, owners of Wikipedia. Further details can be found in the SourceWatch article MyWikiBiz.''